November 11, 1957

?

An hon. Member:

Don't get your notes mixed up.

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LIB

Allan Joseph MacEachen

Liberal

Mr. MacEachen:

Mr. Speaker, I want to say a word now about the problem of trade because it is another problem concerning which the Conservative party has made quite a number of statements and about which there is much to be said by a member from the province of Nova Scotia. We know that the problem of trade has been under discussion in the house not only at this session but at preceding sessions. The most revolutionary statement made on trade, however, was made by the Prime Minister in which he suggested radical surgery and the shift of 15 per cent of Canadian purchases from the United States to the United Kingdom. The only reason I mention this statement is that later in the development of the subject the British chancellor of the exchequer suggested that consideration be given to establishing a free trade area between Canada and the United Kingdom.

The people of the province of Nova Scotia have always been interested in trade and our interest has never reached a concrete realization at any time since prior to confederation. As a matter of fact, the Minister of National Revenue, speaking in Halifax last Saturday, stated that it was the intention of his government to restore the conditions that existed prior to confederation. We know that the economic conditions which accounted for the prosperity of Nova Scotia prior to confederation and, indeed, up to 1878, were based upon free trade. Those of us who study history know as well that it was the members from the maritime provinces, particularly the

The Address-Mr. A. B. Macdonald Liberal members, who prevented the introduction of a national policy of tariff protection until 1878. We know that 1878 signalized the introduction of that tariff policy and the gradual and eventual debilitation of Nova Scotia trade based on worldwide commerce.

We know as well that there was a great effort made in 1911 by Sir Wilfrid Laurier to re-establish a system of free trade between Canada and the United States. That period is still fresh in the minds of Nova Scotians, because again we lost our search for free trade. Today we are still waiting for the present Prime Minister to seize upon the opportunity presented to him by the British chancellor of the exchequer to establish free trade with the United Kingdom for Nova Scotia and all of Canada. As a matter of fact, the Prime Minister, speaking in Sydney just before the election, stated that the election of a Progressive Conservative government in Canada would mean a return to those policies which kept the maritimes in the forefront decades ago. Well, if the Prime Minister is really honest and sincere, as I think he is, he will realize that the only way that this condition can be restored is to take a courageous and statesmanlike attitude and really go forward with the British in establishing a system of free trade.

Before I came here, Mr. Speaker, I travelled through my constituency of Inverness-Richmond. In every part of that constituency I saw the lumber industry languishing because the British purchasers did not have the dollars with which to buy the products of Nova Scotia. If we had a system of free trade with Britain, the British manufacturers would be able to earn the dollars in Canada that would enable them to buy the goods of the primary producers in Nova Scotia, New Brunswick, Prince Edward Island, Newfoundland and the provinces on the west coast of Canada. I do not believe this proposal, which means so much to my province, should have been received by the shocked silence of the Minister of Finance, but should have been accepted as a whole-hearted response of the British government to assist the Prime Minister in his efforts not only to raise the standards in Nova Scotia but also to divert 15 per cent of trade from the United States to the United Kingdom.

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CCF

Alexander Barrett Macdonald

Co-operative Commonwealth Federation (C.C.F.)

Mr. A. B. Macdonald (Vancouver-Kings-way):

Mr. Speaker, it is a pleasure, on behalf of the people of Vancouver-Kingsway, to take part in this debate. Vancouver-Kingsway is an area in southeast Vancouver, an urban area. The people come from many diverse national origins and cultures. They are thrifty and industrious, and I venture to say there is a higher percentage of home owners in

Vancouver-Kingsway than in any other part of Canada. Vancouver, itself, is probably the most rapidly growing city in Canada. It might almost be called the Shangri-la of Canada, attracting people from all the other provinces to its climate, scenery and sunshine although I must admit that at this time of the year the liquid sunshine is more usual than the ordinary kind.

Vancouver may be said to be right at the centre of the crossroads of the world. Hon. members should not smile at that suggestion. It is half way between London and the orient; half way between Moscow and Latin America; half way between Ketchikan, Alaska and Tia Juana, Mexico; in fact, Vancouver is so central many important people say that they simply cannot afford to live anywhere else.

In taking part in a broad debate such as this, Mr. Speaker, in which so much can be said, I feel a little bit like the mosquito in a nudist camp; I don't know where to begin. However, begin I must, and I am speaking in support of the amendment moved by the hon. member for Rosetown-Biggar (Mr. Coldwell). What does that amendment do? The amendment welcomes the promises in the speech from the throne of increases in social security measures, as well as the promised tax relief. Certainly, we in this corner of the house are not going to be guilty of any obstruction. We want to see these measures on the statute books as quickly as possible. We are glad that the breakdown of parties in this house means that the long-forgotten people of Canada have to be given some consideration in so far as social security measures are concerned. We are pleased that neither of the old parties can, in this parliament at any rate, hide behind a large majority and disregard the needs of the people.

We do regret, however, that the increases proposed for old age pensioners, the blind, the disabled and the veterans, have not gone far enough to protect these people who are caught in the spiral of rising living costs. The other day the hon. member for Spadina (Mr. Rea), speaking on behalf of the Conservative party, charged the Liberals with bribing the electorate in the last election by promises of pension increases that amounted to no more than the cost of two cups of coffee per day. After all that campaign oratory and all those promises the Conservative mountain has now laboured and brought forth an increase equal only to the cost of three cups of coffee per day. Yet we have to be grateful for small mercies.

We cannot forget the glaring oversights in the speech from the throne. Surely, this new government cannot continue to turn a blind eye on the twin problems of inflation

and unemployment. How can anyone say that in this year of grace 1957 Canada can afford the human wastage involved in rapidly increasing unemployment.

When speaking last Friday night the Prime Minister (Mr. Diefenbaker) said unemployment was, to use his words, "not generally serious" in Canada. I can say, Mr. Speaker, that it is very serious in British Columbia. The latest official figures we have show that in September of this year unemployment in British Columbia, the Pacific area, stood at 29,800. The previous year the figure for unemployment was about half of that amount. In other words, it is twice as bad this year. Unemployment, even on that scale, is a social crime. Indeed, as Talleyrand, the famous French diplomat said, it is worse than a crime, it is a blunder. Today we are locked in a struggle with the totalitarian regime of the soviets for the hearts and minds of the uncommitted millions of Africa and Asia; a struggle for moral as well as material ascendancy. Unemployment has become something the western world simply cannot afford.

Neither can we afford inflation. In the last two years rising prices, like a thief in the night, have stolen from the pay envelope, from the shopping budget, from the bank account, as much as $5.50 of every $100. Even the vaunted pension increase which government members are heralding so much of $15, that is the Liberal and Conservative increase combined, when judged even in the light of prices as recent as 1949 is not an increase of $15 at all but only $4.70. In other words, in terms of the purchasing power of a dollar a short eight years ago the federal pension we are offered today is only $44.70; that is certainly not a large increase. This process of inflation, therefore, is not comparable to any petty theft at all, it is grand larceny. While prices continue to rise, to date the government has blandly ignored the whole problem, as though hoping it will go away if only no one notices it.

I think it is worse than that, Mr. Speaker. I think the government are relying on the classic solution for inflation of the orthodox economists, the solution of the big business and financial interests of Bay street, Toronto, and the other centres. What is their solution for inflation? Their solution is that to cure inflation you must have a little unemployment. They feel that if only there is not too much money jingling in the pockets of ordinary Canadians, then prices will level off. I believe that cure, of course, is worse than the disease. It reminds me of the doctors of olden times whose cure for any human ailment was to apply a leech and draw off a pint or two of blood from the body of the unfortunate

The Address-Mr. A. B. Macdonald patient. But who can say, in the kind of world in which we live today, that we can afford the national hemorrhage involved in thousands of unemployed, numbering among them our most skilled and productive workers.

Finally, the amendment moved by the hon. member for Rosetown-Biggar (Mr. Coldwell) calls attention to the need for social and economic planning. I do not think the government should any longer be afraid of those two little words "social planning". Surely the cure for inflation is not to have a little bit of unemployment but to plan investment capital both to protect consumer prices on the one hand and to maintain employment on the other. If the big interests which for the last 10 years have made of Canada a profiteer's paradise are not prepared to co-ordinate production and distribution in accordance with the abilities and needs of the Canadian people, then it is high time that this parliament with a united voice reminded them of their duties as well as their privileges.

In listening to the debate on cash advances to prairie farmers I could not help but connect that matter with the need for social planning. It is not that I hold myself out as an expert on farm questions. I think the hon. member for Rosetown-Biggar still gets a laugh when he recalls how 12 years ago when I saw a pile of straw on the prairies, I asked him why the farmers grew that. I think he told me that they grew it to hold up the heads of wheat. But while I am not a farm expert-in fact, far from it-I cannot help observing the folly of unplanned scarcity, free enterprise economics. Here is Canada with our granaries bulging with good foodstuffs and our people in need of many of the necessities for making a good life and there, for instance, is Japan hungry and anxious to exchange with us many of the goods which she can produce very well. Why can such an exchange not take place? Would not both countries be the richer for it? Of course they would. But how can that take place when here in Canada we are hard put to it to keep our own people at work, let alone receive goods from other countries.

The real issue surely must remain an issue between unplanned scarcity and planned abundance. I would therefore ask the government not to be afraid of those two little words in the amendment namely, "social planning". We wish them well in carrying out their responsibility to transact public business at this time. But they should be reminded that that is not only their right but their constitutional duty. There has been too much bantering talk from the government benches

978 HOUSE OF

The Address-Mr. A. B. Macdonald in this parliament about a snap election. Even the Prime Minister, when he gets into some small corner or other, likes to threaten the house darkly with the possibilities of an election, while his excited but uninformed supporters pound their desks behind him. The Solicitor General (Mr. Balcer), speaking in Toronto not long ago, said that the Conservative party was already engaged in a federal election campaign.

However, Mr. Speaker, the people of Canada expect this government, like any other one, to carry out their constitutional duty, to forget electioneering politics and to attend to the transaction of that public business which they were elected to transact. Their constitutional responsibilities in this situation have been well defined by many authorities. Perhaps the foremost one is Canada's own Dr. Eugene Forsey who wrote a book entitled "The Royal Power of Dissolution". The opinion of the experts boils down to this.

Under the usages and conventions of our constitution, it is incumbent upon a government, including a minority government, to carry on with the transaction of public business unless they are defeated in the house or unless they meet obstruction in the house. This government, from what has been said, is not in sight of defeat in this house; and it could hardly be said that there has been any obstruction in the house. Indeed, all parties in the house have helped to see that their legislation has been quickly passed.

I therefore think it is well to remember that there is, in circumstances such as these, a constitutional duty to put the transaction of public business before the political expediency of the government party, even if it thinks it might gain political advantage from an early election. Not that we in this corner of the house-I think perhaps the hon. member opposite was going to say this -are concerned about an early appeal to the people. We are not boys to be frightened by gibes from the government benches. But nevertheless, loose talk about an election, and the kind of loose talk we have heard, seems to me to indicate that those who engage in it forget that this government, like any other one, was elected to transact public business and that as long as it can do so in this parliament, its duty is to carry on while this condition prevails.

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SC
CCF
?

An hon. Member:

On loose talk?

(Mr. Macdonald (Vancouver-Kingsway).]

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CCF

Major James William Coldwell

Co-operative Commonwealth Federation (C.C.F.)

Mr. Coldwell:

No; on the rights of parliament over a government regarding an election.

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CCF

Alexander Barrett Macdonald

Co-operative Commonwealth Federation (C.C.F.)

Mr. Macdonald (Vancouver-Kingsway):

In

this debate reference has been made to something of great concern to British Columbia, namely the fabulous profits that have been reaped by the natural gas pipe line promoters. The hon. member for Rosetown-Biggar placed on Hansard the other day an indictment of these interests that should not fall on deaf ears anywhere in this house. But what has the Conservative party done after all the election promises, after the campaign oratory in which they promised to protect the people of Canada from those whom they described as "piratical profiteers and buccaneers"? Their answer has been to set up a royal commission, the last resort of a government which wants delay, delay, delay. Here is what the Financial Post says-and it is a paper which should be close to Conservative thinking- about that royal commission. In its issue of October 19, 1957 there is a story headed "Tory move picks gas out of current politics" and it is therein stated:

Politically the move is being looked at with great interest. The Conservatives made a lot of noise in the recent session against Trans-Canada Pipe Lines in particular, but most of them now think that the pipe line deal was pretty good.

By setting up the royal commission, which may take months in its investigation, the Tories effectively take the pipe line out of current politics, and they have an answer to the C.C.F. which is expected to move for nationalization of the whole line.

There it is, the time-honoured or rather time-dishonoured method of getting a government off the hook. But even worse in this case, it is a method of getting the pipe line profiteers off the hook. For that commission, with its wide terms of reference, will take at least 18 months, I would say, to complete its hearings and make its report. Then how long after that will it be before the government contemplates action? Well after the next election, I dare say, as hon. members opposite are no doubt thinking. But by that time it will be too late and the millions of dollars in illicit profits that have been made by these pipe line profiteers will have been built into the gas rates charged to the Canadian consumer.

All across Canada the story of profiteering in this public service has been the same. It has been a story of profiteering on a scale that would make the robber barons of 100 years ago wet their lips with envy. A recent issue of Time magazine stated that the tax-free capital gains netted by the promoters of Trans-Canada up to July 1 of this year were estimated at $300 million.

That amount, going into a few pockets taxfree, is almost three times what this house voted a week ago as an addition to the old age security legislation and in almost every province of Canada the story has been the same-Quebec natural gas, Alberta Trunk, northern Ontario-all stories of private killings at public expense. All, I should say with the exception of the province of Saskatchewan which at the local level at least made sure that this public service has been put under public ownership for the benefit and under the control of the people it serves.

My province of British Columbia is particularly concerned with this problem. The company which services us with natural gas is the Westcoast Transmission Company; that is a company which is substantially controlled by a giant United States firm called Sun-Ray Midwestern Oil; also holding a substantial interest of course is Mr. Frank McMahon, the man the Conservatives favoured to receive the rights on the trans-Canada pipe line just a year ago. Westcoast gathers natural gas across the Alberta border and in the British Columbia-Peace river area and brings it down to the coast by pipe line, some 650 miles, to Vancouver and to a United States outlet at Huntington and by a branch line into the interior of British Columbia.

I would simply like to present to the house a few of the hard facts of this operation. .First Mr. Frank McMahon was given an option to purchase 155,000- shares of the company at five cents a share. Before the line was open his profit on that transaction amounted taxfree to $5,600,000.

Second, the same Frank McMahon was given an option to purchase 200,000 shares of the company's stock at $6, exercisable at any time up to 1960. Before the line had opened he had made another profit of $6 million on that.

Third, a United States investment firm and some other United States firms were given the same options as above and netted a taxfree capital gain of $23 million.

Fourth, a firm owned by the big United States company, El Paso Company was given an option to purchase Westcoast shares at $5 per share. The option covered 1,128,000 shares and that netted them a capital gain of $35 million.

Fifth, the total of these capital gains made by the promoters of Westcoast Transmission adds up to the grand sum of $69 million. Now British Columbia is, in resources, a wealthy province, but that figure which will be paid for by the consumers of natural gas

The Address-Mr. A. B. Macdonald in that province, namely $69 million, is almost as much as the province collects for a whole year from its sales tax of 5 per cent.

Sixth, the board of transport commissioners has jurisdiction over Westcoast Transmission which crosses the Alberta border. It is interprovincial and while the Pipe Lines Act passed by this parliament makes as yet no provision for the control and regulation of natural gas rates no doubt that power will be given to the board of transport commissioners. However, how do they go about fixing a fair return to Westcoast Transmission? It will have to be a fair return on capital which includes that $69 million of watered stock. I do not know how you could have a fair return on watered stock, but that will be the way it will end up.

Seventh, with respect to Westcoast Transmission Company this is the last hard fact I have to offer. This United States controlled firm has entered into a contract with United States distributors to sell natural gas across the line at 22 cents per thousand cubic feet while at the same time it is selling the same natural gas to its British Columbia distributor at 32 cents per thousand cubic feet.

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An hon. Member:

Canadian gas?

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CCF

Alexander Barrett Macdonald

Co-operative Commonwealth Federation (C.C.F.)

Mr. Macdonald (Vancouver-Kingsway):

Canadian gas. So I call upon the government as a constructive and forthright act of statesmanship to issue a declaration forthwith under section 92, 10 (c) of the British North America Act declaring natural gas pipe lines in Canada to be works for the general advantage of Canada or the advantage of two or more provinces. That was one of the solutions: i.e. public ownership, advocated in this house by the Conservative party not a year ago. If they wish to redeem their promises of that time they will quickly transfer these companies into public services, of the people, by the people and for the people.

I was pleased that the throne speech mentioned a national development program to be carried out in co-operation with the provinces. Again that is a matter of concern to my own province which is a treasure house of potential mineral, timber and water resources. The speech from the throne mentioned the Columbia river development particularly and yet there have been two stumbling blocks. There have been negotiations going on with the United States authorities with respect to compensation for down stream benefits and there have been protracted negotiations with the British Columbia government as to the financing involved and the form the enterprise would take.

980 HOUSE OF

The Address-Mr. A. B. Macdonald It is a great pity that we have heard of no progress in these negotiations with the United States authorities since May 20 of this year when the last conference at the ministerial level broke up without result. Surely Canada, in a matter of such concern to one of her provinces as this, should not be without some bargaining power in dealing with the United States authorities. In connection with the second matter I am sure the majority of the people in British Columbia think this enterprise should take the form of public hydro. It should hardly be necessary any longer in this house to defend public hydro as against private hydro. The success of the Ontario hydro commission and of the Tennessee Valley authority with its vast complex of irrigation, power, conservation and industrial development, have conclusively proved that public power is cheaper power and that public hydro is closer to the needs of the region and of the people it serves.

In my own province of British Columbia that is borne out very dramatically by the electricity rates we pay. In Manitoba with public hydro and scarce water resources the average cost per kilowatt hour is three-quarters of a cent while in British Columbia under private hydro and with lots of water resources we pay an average rate per kilowatt hour of 2.1 cents.

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CCF

Alexander Barrett Macdonald

Co-operative Commonwealth Federation (C.C.F.)

Mr. Macdonald (Vancouver-Kingsway):

The

power commission unfortunately under a free enterprise minded government has been starved and not allowed to operate or move into the rich areas where they would really have an opportunity to bring down the price of electricity.

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CCF

Alexander Barrett Macdonald

Co-operative Commonwealth Federation (C.C.F.)

Mr. Macdonald (Vancouver-Kingsway):

Saskatchewan rates are far below those in British Columbia.

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?

An hon. Member:

How about Alberta?

Another hon. Member: That is a good question.

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CCF

Alexander Barrett Macdonald

Co-operative Commonwealth Federation (C.C.F.)

Mr. Macdonald (Vancouver-Kingsway):

So

we ask that the government proceed with this national development program as promised and I suggest it is one of the things that should be put upon the statute books and under way before this government thinks of holding an election.

There is another matter of importance to British Columbia under the heading of national development. North of the Peace river area lies the Rocky mountain trench. [Mr. Macdonald (Vancouver-Kingsway) .1

The people of Texas say that they carry out things in a big way; they do nothing on the scale on which it is done in British Columbia.

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An hon. Member:

Smalltime operators.

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CCF

Alexander Barrett Macdonald

Co-operative Commonwealth Federation (C.C.F.)

Mr. Macdonald (Vancouver-Kingsway):

The British Columbia government has given a reserve with first rights out of that reserve to the Wenner-Gren interests, amounting I think to 71,000 square miles.

No TV give-away program can match that, and yet the federal government is involved and has a responsibility because the Peace river, of course, flows over the Alberta border and up into the Northwest Territories. Therefore I repeat again, let this national development program in co-operation with the provinces include the development of Peace river power if that is feasible from an engineering and financial standpoint at the present time. Concerning the question of whether or not it is feasible, let the engineers of the department of national resources give their opinion as well as those of the Wenner-Gren interests.

What is this Wenner-Gren foundation? Some kindly souls have suggested that it is a charitable or philanthropic organization. Of course it is nothing of the kind. Wenner-Gren himself was blacklisted in the last war for trading with the Nazi enemy. Much of the wealth he made which poured into British Columbia came from munitions produced in the last war. Fortunately for him, but unfortunately for the province of British Columbia, one * of the three directors of Wenner-Gren in that province is a man who is also the head of the P.G.E. railway of the government of British Columbia and the financial wizard behind the Social Credit party there.

There should be no difficulty, Mr. Speaker, about the public financing of a hydro-electric development program that has been proved to be sound in an engineering way and in a financial way, and if this national development program means what I hope it means then we should move to help safeguard in co-operation with the provinces some of the equity of the people themselves in their natural resources.

I said earlier that we in this parliament have a heavy responsibility to legislate not only for the welfare but indeed for the safety of Canada. It would be madness to underestimate the scientific and technological progress of the soviet union in throwing artificial moons into the firmament, or to ignore their military and political implications. It is not so much that we need fear war itself. We can dare to hope that General Partridge in Colorado Springs will never have

to push that button that will mean annihilation for victor and vanquished alike. But those who hold precious the rights of free discussion and inquiry can lose in ways other than war if the uncounted millions of Africa, Asia and the Middle East turn not to the west or the United Nations but to the east and to the soviet dictatorship.

How can the west safeguard its position? Not by piling up new and more dreadful weapons of war. Arms alone will not save us. What we must do is recreate our society as a model embodying the human ideals of equality, freedom and fellowship upon which the peoples of the world can look with inspiration and affection. We have a long way to go toward these ideals, away from the crass materialism, dollar worship and false values of a profit driven society. There will be no excuse for us if we fail to read the signposts and plot our direction accordingly.

In this connection I cannot help but be concerned about the remarks made by irregular members of the Conservative party in various parts of Canada who seem determined to tear down and dismantle national television and broadcasting under the C.B.C. They would turn it over to the hucksters. Mr. Speaker, there is no quicker way to debauch the mind and soul of a nation than by turning over to commercial advertising interests the control of broadcasting and television. It is not that the C.B.C. cannot be improved and brought closer to the communities it serves, but I would express the hope that the Minister of National Revenue

With that I conclude as I began, by urging the government to adopt the amendment of the hon. member for Rosetown-Biggar. It is certainly later than we think, and none too soon to awaken in our people a driving social purpose that will enable us to meet the dangers as well as the opportunities of the world in which we live.

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PC

James Aloysius McGrath

Progressive Conservative

Mr. J. A. McGrath (St. John's East):

Mr. Speaker, in speaking to the motion for an address in reply to Her Majesty's speech from the throne, I would first of all like to take this opportunity to pay tribute to a former member of parliament who is now deceased, Gordon F. Higgins, Q.C., O.B.E., whose death on October 13 last after a long illness came as a great shock to us in Newfoundland. He was the first member of this house for the constituency that I now so humbly represent. Mr. Higgins during his

The Address-Mr. McGrath tenure of office from 1949 to 1953 was widely known and respected by members on both sides of the house and his voice, speaking on behalf of Newfoundland and Newfoundlanders was a familiar sound in this chamber.

Gordon Higgins, like his father before him, played a very important role in Newfoundland politics. In 1946 he was elected to represent St. John's East at the national convention which was convened in St. John's by the British government to decide the political future of Newfoundland. He was, like many of us in Newfoundland, vigorously opposed to confederation, not in principle but in the way it was being brought about, and like many of his colleagues he advocated that if terms were to be negotiated with Canada these terms should be negotiated by our own elected government, between two sovereign states and not two political parties.

When the votes of the second referenda were tabulated and confederation with Canada won out by some 6,000 votes Mr. Higgins offered himself as a candidate to represent St. John's East at Ottawa. He did this because he felt that in the House of Commons he would have a chance to continue the fight for his beloved island home. Although he polled a good majority of the votes cast in the election of 1953 he was defeated by a split vote. From then on his health began to fail. His death came as a sad blow and I am sure that hon. members on both sides of the house who knew the late Mr. Higgins will join with me in extending deepest sympathy to his bereaved family.

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?

Some hon. Members:

Hear, hear.

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November 11, 1957